The Ethanol Papers - Paperturn manuscript - Flipbook - Page 626
taxes and so the 50 cents I’m referring to may not be the same everywhere. I’m
using California as my reference.
A good example of this problem is what is happening right now in Iowa as I write
this section. Here’s the story from Ethanol Producer Magazine written by Holly
Jesson:
“Linn Co-op Oil Co. and Iowa’s other E15 retailers were recently forced
to stop selling E15 because oil refiners won’t supply the gasoline blend
stock required for the summer months. “Consumers who want a higher
grade ethanol blend, in this case E15, are being denied that choice,” said
U.S. Rep. Bruce Braley, D-Iowa. Braley was part of a June 3 conference
call hosted by the Iowa Renewable Fuels Association that was held to
discuss the petroleum distribution monopoly, one of the tools Big Oil is
using to block the sale of higher ethanol blends, said Monte Shaw, executive director of IRFA.
In the summer months, the U.S. EPA allows E10 to exceed the 9.0
pounds-per-square-inch Reid Vapor Pressure requirement by 1 pound
from June 1 to Sept. 15 but did not give E15 the same waiver. In order to
offer E15 to vehicles model year 2001 and newer, the renewable fuel
must be blended with low-volatility gasoline, which is used in markets that
require reformulated gasoline. The catch is, although that fuel travels
through Iowa via pipeline, E15 retailers are being denied access and
therefore must only sell E15 to flex-fuel vehicle drivers or shut down their
E15 pumps, as Linn Co-op did. “One of the key things about this is, we’re
not asking for something that doesn’t exist,” Shaw said. “The gasoline
blend stock we need to make E15 in the summer is available, it flows
through the very pipeline system that services Iowa, but they will not let
us take it out of the pipeline here.”
Earlier this year, a group of Iowa’s E15 retailers sent a letter, asking oil refiners
supplying Iowa to provide the summer gas blend stock required for E15, IRFA
said. However, as of June 1, no oil refiner has done so. In the meantime, the
necessary blend stock travels through Iowa, on its way to Kansas City and Chicago, where reformulated gas is required due to high smog levels. Retailers in
the vicinity of a market that requires reformulated gas can continue to offer E15
by trucking in the blend stock but transportation costs to Iowa make that cost
prohibitive, Shaw said.
Oil refiners are using RVP seasonality to block retailers from selling E15 because they don’t want to give up the 5 percent market share, Shaw added. In
